Oct 2, 2002 4 min read

ANCHORAGE, Alaska (AP) – With its sheer size, its brutal cold and its long winter nights, Alaska is a land of extremes. But when it comes to wealth, it has the smallest gap between rich and poor of any state.

The findings are based on household income data from the 2000 census.

And a look around Alaska, the biggest state in area, seems to confirm it.

Someone walking through the best neighborhoods in Anchorage would find only a few million-dollar homes.

In the city’s lower-income neighborhoods there are few if any of the boarded-up homes found in other states.

In Alaska’s harbors, commercial fishing boats greatly outnumber yachts and other pleasure boats.

While the gap between rich and poor grew by about 3.1 percent nationally during the 1990s, it barely budged in Alaska.

The state with the largest gap was New York, at 49.4. The state with the smallest was Alaska, at 40.0.

The median household income for Alaska in 1999 was $51,571, compared with $43,393 in New York.

Economists say there are several factors that level the playing field in Alaska. Among them: the oil dividend check mailed out annually to practically every man, woman and child in the state.

This month, more than 591,500 Alaskans will get $1,540.76 each from an account that receives royalties from the North Slope oil that is pumped via the Alaska pipeline.

“Our low-income people are not as low income as the rest of the nation because they all get a dividend,” said Larry Persily, deputy commissioner of revenue.

For a family of four, for example, the dividend will mean a cash infusion of more than $6,000 this year.

Low-income households in Alaska saw their incomes rise during the past decade as the dividend rose along with the stock market.

At the same time, the technology boom of the 1990s that created overnight millionaires in the Lower 48 states largely bypassed Alaska.

“I’m not aware of any billionaires in Alaska,” said Gunnar Knapp, an economics professor at the University of Alaska-Anchorage.

Also contributing to the narrow gap between rich and poor: Alaska has fewer low-paying jobs.

“We don’t have a lot of migrant farm workers or a huge retail industry or service industry. Yes, we have McDonald’s and Wal-Mart, but not as many as in other places,” Knapp said.

“A very significant part of our employment is in government, and those are reasonably well-paying jobs.”

Another explanation offered: Alaska is a relatively young state.

“We don’t have old money,” said Clair Ramsey, a real estate agent who sells higher-end homes.

“It usually takes more than a generation to make real money, unless you’re a Bill Gates or a Michael Jordan or a Julia Roberts.

“We don’t have movie stars here.”

Still, the cost of living in rural Alaska is 25 percent to 45 percent higher than in Anchorage, and the cost of living in Anchorage is about 13 percent higher than in the Lower 48, said Neal Fried, an economist with the state Labor Department.

And without a doubt, there are pockets of poverty in the countryside.

In Nunapitchuk, 400 miles east of Anchorage, nearly 21 percent of the village’s 466 residents live in poverty. The village sits amid a vast web of lakes, streams and muddy sloughs that are rich in fish and waterfowl for hunting and fishing but short on opportunities to make money.

Most jobs in Nunapitchuk are with the local government and school.

Robert Nick, who owns the only grocery store in the village, laughs at the idea that Alaska’s rich and poor are not so very far apart.

“I thought the disparity was as great as the North and South Pole.”

Nick said the only time the gap seems narrow to him is in October, when the dividend checks are mailed out.

But then, families in rural Alaska use the money to pay off bills and to buy snowmobiles, boats and all-terrain vehicles to use for hunting and fishing.

“Then, the disparity is great again,” Nick said.